GlossaryRetail & Inventory
Supplier
Also called: vendor
What is Supplier?
A supplier, or vendor, is a business you buy goods or services from on agreed rates and terms. Supplier records hold contact details, GSTIN, agreed prices, credit terms and the history of what has been bought and paid.
Why Supplier matters
Supplier terms are as important to cash flow as customer terms. A supplier offering 30 days is financing your stock, while one demanding advance payment is being financed by you.
How Supplier works in practice
Keep a supplier master with GSTIN, credit terms, lead time and rate history, and reconcile balances periodically. Two suppliers per critical line is the cheapest insurance against a supply failure.
Frequently asked questions
At least two for anything critical, even if one gets most of the volume.
Related terms
Vendor ReconciliationMatching your supplier ledger against the supplier's own statement.Purchase OrderA formal order to a supplier stating what you agreed to buy.Accounts PayableMoney you owe suppliers for goods or services already received.Lead TimeThe time between placing an order and receiving the goods.